Shares of Eli Lilly (NYSE: LLY) were jumping 3.3% higher as of 12:07 p.m. ET on Wednesday. This gain looked even better considering that the major market indexes were all slumping.

Lilly was able to swim against the market current primarily because of investors’ enthusiasm about the prospects for the company’s weight-loss drug Zepbound. On Tuesday, BMO analyst Evan Seigerman wrote to clients that Lilly’s drug already appeared to be taking market share away from Novo Nordisk‘s Ozempic and Wegovy. Seigerman stated, “This is early validation that Lilly’s franchise will dominate the landscape in 2024.”

Will Lilly’s Zepbound dominate the obesity market?

It does seem likely that Siegerman’s bullish take on Zepbound will eventually be proven correct. However, whether or not Zepbound truly dominates the obesity market in 2024 is another matter.

Market researcher Evaluate projects that Novo Nordisk will generate additional new sales of close to $8 billion in the new year. It expects Lilly to deliver a sales increase of around $5 billion. Those revenue gains put Novo and Lilly at the top of the biopharmaceutical industry, but Evaluate thinks that Novo will edge out Lilly — for now.

Is Eli Lilly stock a buy?

With Eli Lilly’s shares trading at a sky-high forward price-to-earnings ratio of 48, some investors might think this stock is too expensive to buy. My view, though, is that Lilly provides a textbook example of why forward earnings multiples don’t always tell the full story.

Lilly won’t just deliver impressive growth in 2024; it will likely do so for many years to come. And Zepbound isn’t the only growth driver for the big drugmaker. I’m not concerned about Lilly’s seemingly lofty valuation. I think this stock is still a buy even after skyrocketing nearly 70% over the last 12 months.

Should you invest $1,000 in Eli Lilly right now?

Before you buy stock in Eli Lilly, consider this:

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Keith Speights has no position in any of the stocks mentioned. The Motley Fool recommends Novo Nordisk. The Motley Fool has a disclosure policy.

Why Eli Lilly Stock Is Jumping Today While the Overall Market Is Slumping was originally published by The Motley Fool